Positive results are now in from Toro Energy’s scoping study into a standalone uranium-vanadium mining and processing operation at its Lake Maitland deposit within the company’s broader Wiluna uranium project in WA’s northern Goldfields region. After the cursory size-up, the standalone project currently holds a pre-tax net present value of $610 million and a total capital cost of $270 million.
Toro’s proposed operation would process 1.94 million tonnes of ore per annum over a mine life of 17.5 years and churn out 22.8 million pounds of uranium oxide and 11.9 million pounds of vanadium pentoxide as a welcome by-product. The assessed operation boasts an impressive internal rate of return of 41 per cent with a payback period of 2.5 years.
When it comes to pre-tax undiscounted cash flow the project would draw in a total of $1.4 billion and an annual value of $81.3 million. In terms of earnings before interest, taxes, depreciation and amortization, or “EBITDA” the project would generate a total of
$1.7 billion and an annual amount of $98 million.
The scoping study incorporated efficiencies gained from several years spent improving and redesigning the company’s flowsheet and has determined a processing plant on-site at Lake Maitland would deliver superior financial results.
Toro Energy Executive Chairman, Richard Homsany said: “Lake Maitland represents a significant proportion of the Wiluna Uranium Project’s resources, and these Scoping Study results clearly illustrate the transformational effect of the stand-alone Lake Maitland operation on the potential economics of the entire Wiluna Uranium Project.”
The Lake Maitland uranium deposit is just one of four deposits that form part of Toro’s fully owned Wiluna uranium project in WA’s northern Goldfields region 710km north-east of Perth. The company believes there is significant scope to further optimise the scoping study outcomes given Lake Maitland’s proximity to its other three deposits within the project. The amalgamation could increase the production at Lake Maitland in addition to extending the window of processing of its high-grade uranium resource well beyond seven years.
It appears nuclear power is back on the agenda of the world. Even the uranium-scarred island country Japan is eyeing a restart of its mothballed nuclear plants over 10 years after the Fukushima disaster of 2011. In the same vein, a recent report by Bank of America suggested global investment in mining needs to double to satisfy the growing demand for applications that range from renewable energy generation and storage to electric vehicles.
Toro is ahead of the pack when it comes to seeing uranium as a complement to renewables as the globe strives to meet the ambitious net-zero targets. However, whilst its numbers may be attractive it has a few political hurdles to clear before it can start to cash in.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Matt Birney
